A Personalized, Sensitive Approach To Bankruptcy

Consumer rights give debtors power to stop creditor harassment

On behalf of The Law Office of Kim Covington posted in chapter 13 bankruptcy on Thursday, April 18, 2019.

Collection agencies sometimes cross the line into harassment when they contact debtors in Oregon. Abusive language, threats or excessive telephone calls and texts can add significantly to the stress of people who have fallen behind on payments. The Fair Debt Collection Practices Act recognizes that people might need protection from creditor harassment and establishes restrictions on the actions of debt collectors.

This law applies to collection agencies, debt buyers and lawyers but not to original creditors, such as a hospital that issued the bill. Third-party collectors for car loans, medical bills, home loans or credit cards must adhere to the law that forbids unfair and deceptive collection practices. They must restrict telephone calls to between 8 a.m. and 9 p.m. Debtors do not have to tolerate calls at their places of employment, and creditors cannot discuss people's debts with their friends or relatives except for spouses.

A debtor who wants communications to stop can make the request in writing, and the law obligates collection agencies to honor the request. Debtors also have the right to make a collector confirm the source of the unpaid debt. They must provide the creditor's name and outstanding balance.

A person who hires an attorney can insist that all communications go through the attorney's office. Legal representation might enable someone to resolve a disputed debt or prepare a debt management plan, such as a Chapter 13 bankruptcy. In this form of bankruptcy, the attorney may help the person create a manageable payment plan that lasts three to five years. After filing the financial paperwork with the court, an attorney may gain approval to halt a foreclosure or other collection action. This process might allow a person to regain control of finances instead of losing assets and falling deeper into debt.

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